ArubaAdventurer

Hi everyone, new to the forum, but have been to Aruba multiple times and love it! Might like to consider selling timeshares and buying a condo, but on my last trip I learned that one would normally need to put 50% down and finance the rest over 10 - 15 years; quite different from the lower down payment, 30 year mortgages in the US. Not sure if this is the right place to ask (thought I had seen a Buying A House in Aruba page in the past, but now can't find it) - but does anyone have any advice on finance options for buying a place in Aruba? It seems a number of people on this forum own houses in Aruba, and just wanted to find out how people did the financing, and if they dealt with local banks how difficult/easy it was. Any advice would be great. Thanks in advance.

madricharubabound

Hi,
we are buying in Aruba. The advice we got is not to borrow money in Aruba. If you own propery in the States it is better to line of credit or equity loan as you can write off the interest on your taxes and our rate of borrow is much cheaper. Actually even if you had the cash this is a smarter way because of the tax write off. I am not a tax expert but this is the advice we got.

skdiddy

If it is a 2nd home then it is a vacation home, then mortgage interest is deductible. If you rent it out more than 14 days a year, then things change a bit, BUT, I could not find anywhere that stated that the vacation home must be in the U.S.

If you "live" on the island, there is a period of time where you have to travel back to the states for a week or two to continue citizenship, not sure of the specifics, but you can find that out elsewhere.

Definitely either get 2nd mortgage OR new mortgage for a vacation home from the States.

If you rent out your home for 14 days or more per year, it is considered an investment and is subject to slightly higher borrowing percentage, but you also qualify for numerous deductions, include depreciation of the main asset (home) as well as depreciation of everything in the home from flooring, draperies, appliances, etc and you can still take the deduction for mortgage interest.

This all assumes that you remain a citizen of the U.S. and file your taxes in the U.S.

Hope this helps?





SK

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SanNic44

Wouldn't borrow any money from Aruba banks. Service is shabby compared to the US and interest rates are very high. If there is a problem, you will be subject to Aruban law, another much bigger problem. In today's investment climate, it may be wise to do as others have posted and use equity from you US residence. Barring that, find friends to join in a small partnership type arrangement and piece out the weeks. No mortgage=no interest=happiness.

Just an idea.

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